Automotive Axles Limited , a leading manufacturer of automotive components, has released its financial results for the second quarter of fiscal year 2025-26, along with important company updates.

Financial Highlights

Automotive Axles maintained a nearly flat net profit at ₹359.50 crore compared to ₹359.70 crore in the same quarter last year. However, revenue saw a decline of 6.87% year-over-year, dropping to ₹461.00 crore from ₹495.00 crore.

Despite the revenue decrease, the company managed to improve its EBITDA margin to 10.46% from 10.33% in the previous year, indicating enhanced operational efficiency. The EBITDA, however, decreased slightly to ₹48.29 crore from ₹51.09 crore year-over-year.

Balance Sheet Highlights

As of September 30, 2025, Automotive Axles reported total assets of ₹13,283.69 million and total equity of ₹10,065.23 million.

Operational Performance

The company's ability to maintain profit levels despite lower revenue suggests effective cost management and operational optimization. The improved EBITDA margin reflects the company's efforts to enhance profitability amidst challenging market conditions.

Management Changes

Automotive Axles has announced that Mr. Ranganathan S, the current Chief Financial Officer (CFO), will be superannuating from his service effective November 22, 2025. Consequently, he will cease to hold the position of CFO, which is a Key Managerial Personnel role in the company.

Corporate Governance

The company's Board of Directors approved the unaudited financial results for the quarter and half-year ended September 30, 2025, at a meeting held on October 30, 2025. The financial results were reviewed by the company's statutory auditors, M/s SR Batliboi Associates LLP, ensuring compliance with regulatory requirements.

Market Context

The automotive component sector continues to face challenges, including global supply chain disruptions and fluctuating demand in the auto industry. Automotive Axles' performance in the coming quarters will be closely watched by market participants to assess its ability to navigate the evolving market dynamics.

Automotive Axles Limited , a leading manufacturer of axles and brakes for commercial vehicles, reported a flat revenue of INR 498.00 crores for the first quarter, remaining stable compared to the same period last year. Despite the challenging market conditions, the company managed to improve its profitability, with EBITDA margin expanding from 11.20% to 11.70% and PAT margin increasing from 6.90% to 7.30% year-over-year.

New Business Model Implementation

The company has implemented a new business model, consolidating sales at the Automotive Axles level instead of routing through Meritor HVS India Limited. This change is expected to bring marginal improvements in margins, although the full impact will be more visible in the coming quarters.

Market Outlook

The overall commercial vehicle market is anticipated to be flat or down by 4% this year. Kishan Kumar, General Manager at Meritor HVS (India) Limited, noted that Q2 is expected to be softer due to inventory buildup and monsoon impact. However, the company remains optimistic about recovery in Q3 and Q4.

Product Mix and Market Trends

Automotive Axles is witnessing a shift in product mix, with higher demand for heavy-duty engines in the truck segment and increased volumes in the bus segment. The company has already launched products for the 4x2 tractor trailer and tipper segments, and is well-positioned to cater to the growing bus market.

Capex and Expansion Plans

The company's board has approved a capex of INR 120.00 crores for capacity enhancement and automation. This investment is part of Automotive Axles' strategy to double its revenue by FY30. The capex will be implemented in two phases, with completion expected by the end of FY26 and Q3 FY27, respectively.

New Product Development

Automotive Axles is currently developing new products, including 13.5m and 15m bus axles, which are in the prototype stage. The company is also fine-tuning product specifications to meet changing customer applications and demands, with prototypes expected to be ready by the end of the current fiscal year.

Export Challenges

While the company faces some challenges in the export market due to ongoing tariff discussions and low demand in North America, the management stated that their export exposure to North America is relatively small and not a significant concern at present.

Financial Performance

Nagaraja Gargeshwari, President and Whole-Time Director of Automotive Axles, commented on the results, stating, "Despite the soft market, we are able to put up a very strong performance and then we continue to improve our EBITDA and cash flow for the quarter."

The management remains cautiously optimistic about the future, expecting the market to recover in the second half of the fiscal year. They have emphasized their commitment to improving profitability through cost reduction initiatives, automation, and new product development.